(Learning Objectives 1, 3: Measure, depreciate, and report plant assets) During2018, Chang’s Book Store paid $481,000 for land and built a store in Newark, New Jersey.Prior to construction, the city of Newark charged Chang’s $1,200 for a building permit, whichChang’s paid. Chang’s also paid $15,200 for architect’s fees. The construction cost of $679,900was financed by a long-term note payable, with interest costs of $28,180 paid at the completionof the project. The building was completed June 30, 2018. Chang’s depreciates the buildingusing the straight-line method over 35 years, with estimated residual value of $335,000.1. Journalize transactions for the following (explanations are not required):a. Purchase of the landb. All the costs chargeable to the building in a single entryc. Depreciation on the building for 20182. Report Chang’s plant assets on the company’s balance sheet at December 31, 2018.3. What will Chang’s income statement for the year ended December 31, 2018, report forthese facts
(Learning Objectives 1, 3: Measure, depreciate, and report plant assets) During
2018, Chang’s Book Store paid $481,000 for land and built a store in Newark, New Jersey.
Prior to construction, the city of Newark charged Chang’s $1,200 for a building permit, which
Chang’s paid. Chang’s also paid $15,200 for architect’s fees. The construction cost of $679,900
was financed by a long-term note payable, with interest costs of $28,180 paid at the completion
of the project. The building was completed June 30, 2018. Chang’s depreciates the building
using the straight-line method over 35 years, with estimated residual value of $335,000.
1. Journalize transactions for the following (explanations are not required):
a. Purchase of the land
b. All the costs chargeable to the building in a single entry
c.
2. Report Chang’s plant assets on the company’s balance sheet at December 31, 2018.
3. What will Chang’s income statement for the year ended December 31, 2018, report for
these facts
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